Fed statement gives oil added boost; gasoline, natgas futures rally

SAN FRANCISCO (MarketWatch) — Crude-oil prices climbed closer to $98 a barrel Wednesday, getting an added boost after the U.S. Federal Reserve kept its easing stance as expected, while gasoline futures rallied past $3 a gallon on the heels of a surprise drop in inventories.

Crude oil for March delivery
US:CLH3
settled at $97.94 a barrel, up 37 cents, or 0.4%, on the New York Mercantile Exchange.

It was trading around $97.80 before the Fed statement. The statement came 15 minutes ahead of the close of the Nymex trading session.

The policy statement by the Fed’s Open Market Committee “was well received by the crude-oil market ... since anything that provides long-term monetary support to demand for energy is viewed as another positive for oil,” said Richard Hastings, a macro strategist at Global Hunter Securities.

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The EIA data were “definitely a surprise, especially on the crude front,” said Tariq Zahir, managing member at Tyche Capital Advisors, in an email.

“While we have seen crude grind higher over the past several says we feel this could be the straw that breaks the camel’s back over the coming days and week,” he said.

Motor gasoline supplies, however, fell by 1 million barrels, while distillate stocks declined by 2.3 million barrels, the EIA said. Analysts expected no change to gasoline stocks and a fall of 1 million barrels in distillate supplies.

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